Alphabet stock may drop over 40% after recent rally despite strong Q1 earnings.

Alphabet's stock surged nearly 30% monthly and 10% weekly, driven by strong Q1 2026 earnings with revenue of $109.9 billion and significant growth in Google Cloud. However, technical analysis warns of a potential major correction, projecting a drop of over 40% in the coming months, possibly falling to around $225. This outlook is based on historical trading patterns and momentum cycles, suggesting the stock could weaken after testing the upper boundary of its long-term trading channel by December 2026. Investors should watch for a monthly close below the 50-week moving average as a bearish signal indicating a possible downtrend ahead.